Centre moves tobacco, pan masala levy Bills, seeks to retain mopup

New excise and cess proposals aim to boost central revenue as GST compensation period ends; states won't share proceeds

In a move that would empower the Centre to collect additional revenue from so-called “sin goods”, Union Finance Minister Nirmala Sitharaman on Monday introduced two major taxation Bills in the Lok Sabha to further raise central excise duty on tobacco products and impose a levy on pan masala to fund expenditure related to public health and national security.

 

So far, the Centre had imposed a cess on such products since July 2017, which was shared with states to compensate them for revenue losses arising from the implementation of the goods and services tax (GST). However, the centre government stopped compensating